Abbas and Olmert announced a fast-track process to settle outstanding issues in the peace process by the end of 2008, Haaretz reported Tuesday.

Saeb Erekat, the chief negotiator for the Palestinians, said the two parties spoke mostly on the construction of Jewish settlements in the West Bank.

The negotiation of the latest peace settlement unveiled in Annapolis, Md., in November faced several challenges from both sides, with Abbas facing an obstacle controlling Hamas and Olmert getting resistance from right-wing Israeli parties, The Los Angeles Times said.